Marketing by the Numbers Diet Coke with Fiber

Coca$-$Cola launched Coca$-$Cola Plus in a limited market in Japan last year and now plans to launch it nationwide in that country. Coca$-$Cola Plus is a zero$-$calone soda $($essentially Diet Coke$)$ with $5$ grams of an indigestble dietary fiber called dextrin. Although some might just call it Diet Coke with a laxative, Coca: Cola Plus is touted in Japan as a heath food that suppresses the absorption of fat and keeps blood triglycerides at moderate levels. In fact, the product has earned the Japanese government's "gold label," designating it as a government$-$approved Food of Specific Health Use $($FOSHU$).$ Although the new Coca$-$Cola Plus reaps a higher wholesale price for the company $($ $$1,20$ per $470-$milliter bottle versus $$1$:$15$ per bottle for the criginal Diet Coke$),$ it also comes with higher varlable costs $($ $$0\mathrm{.}65$ per bottle versus $$0\mathrm{.}55$ per bottle for the original product$).$ Athough some Diet Coke drinkers will switch to Coca$-$Cola Plus, the company beleves the new product will attract new customers because of its health benefits. Coca$-$Cola is no stranger to introducing new products in Japan. The company released Coca$-$Cola Cotfee

Plus last year and recently introduced its first alcoholic beverage called Lemon Do$.$

$8-14$ What brand developenent strategy is Coca$-$Cola undertaking? $($AACSB: Commurication; Reflective Thinking$)$

$8-15$ Assume the compery expects to sel $5$ millon bottles of Coca$-$Cola Plus in the first year after introduction but that $60$ percent of those sales wil come from buyers who would normally purchase Diet Coke that is$,$ carnibalized sales$).$ Assuming the sales of Diet Coke are nomally $300$ milion bottles per year and that the company wil incur an increase in fxxed costs of $$500,000$ during the first year to launch Coca$-$Cola Plus, will the new product be profitable for the company? Fieter to the Financial Analysis of Marketing Tactics: Extend the Product Line section in Apperndix $2$: Marketing by the Numbers for an explanation regarding how to conduct this aralysis. $($AACSB: Communication; Analytical Reasoring$)$